H*4304 Session 113 (1999-2000)
H*4304(Rat #0314, Act #0285 of 2000) General Bill, By Bailey
A BILL TO AMEND SECTION 40-57-135, CODE OF LAWS OF SOUTH CAROLINA, 1976,
RELATING TO DUTIES OF REAL ESTATE BROKERS-IN-CHARGE AND MANAGERS-IN-CHARGE, SO
AS TO CLARIFY CERTAIN CIRCUMSTANCES UNDER WHICH A TRUST ACCOUNT MUST BE
ESTABLISHED AND MAINTAINED.
11/17/99 House Prefiled
11/17/99 House Referred to Committee on Labor, Commerce and Industry
01/11/00 House Introduced and read first time HJ-414
01/11/00 House Referred to Committee on Labor, Commerce and
Industry HJ-414
02/02/00 House Committee report: Favorable Labor, Commerce and
Industry HJ-6
02/08/00 House Read second time HJ-18
02/09/00 House Read third time and sent to Senate HJ-16
02/10/00 Senate Introduced and read first time SJ-8
02/10/00 Senate Referred to Committee on Labor, Commerce and
Industry SJ-8
04/27/00 Senate Committee report: Favorable Labor, Commerce and
Industry SJ-7
05/02/00 Senate Read second time SJ-19
05/03/00 Senate Read third time and enrolled SJ-18
05/16/00 Ratified R 314
05/19/00 Signed By Governor
05/19/00 Effective date 05/19/00
06/07/00 Copies available
06/07/00 Act No. 285
(A285, R314, H4304)
AN ACT TO AMEND SECTION 40-57-135, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DUTIES OF REAL ESTATE BROKERS-IN-CHARGE AND MANAGERS-IN-CHARGE, SO AS TO CLARIFY CERTAIN CIRCUMSTANCES UNDER WHICH A TRUST ACCOUNT MUST BE ESTABLISHED AND MAINTAINED.
Be it enacted by the General Assembly of the State of South Carolina:
Duties of brokers-in-charge and property managers-in-charge
SECTION 1. Section 40-57-135(A)(1) of the 1976 Code, as added by Act 24 of 1997, is amended to read:
"(1) adequately supervise employees or associated licensees and maintain real estate trust accounts when required by law;"
Duty to establish and maintain a trust account
SECTION 2. Section 40-57-135(B)(1) of the 1976 Code, as added by Act 24 of 1997, is amended to read:
"(1) A broker-in-charge or property manager-in-charge, when taking possession of funds belonging to another in connection with a real estate transaction, shall establish and maintain control of and responsibility for an active real estate trust account so designated in the company name for which the respective broker-in-charge's or property manager-in-charge's license is issued; however, the brokers-in-charge or property managers-in-charge of a real estate company with multiple offices may utilize one central trust account."
Duty to maintain a recordkeeping system
SECTION 3. Section 40-57-135(B)(7) of the 1976 Code, as added by Act 24 of 1997, is amended to read:
"(7) A broker-in-charge or property manager-in-charge, when required by this chapter to establish and maintain a real estate trust account, also shall maintain, in his designated principal place of business, a recordkeeping system consisting of:
(a) a journal or an accounting system which records the chronological sequence in which funds are received and disbursed for real estate sales. For funds received, the journal or accounting system must include the date of receipt, the name of the party from whom the money was received, the name of the principal, identification of the property, the date of deposit, the depository, the payee, and the check numbers, dates, and amounts. A running balance must be maintained for each entry of a receipt or disbursement. The journal or accounting system must provide a means of reconciling the accounts;
(b) a journal or an accounting system containing, for property management, the same information as stated in subitem (a) except that the required running balance may be determined at the time of reconciliation;
(c) a separate record for each tenant identifying the unit, the unit owner, amount of rent, due date, security deposit, and all receipts with dates when managing property. There also must be maintained an owner's ledger for all properties owned by each owner showing receipts and disbursements applicable to each property managed. All disbursements must be documented by bids, contracts, invoices, or other appropriate written memoranda;
(d) trust account deposit documents shall identify the broker-in-charge or property manager-in-charge and the buyer or tenant unless other appropriate written memoranda are maintained;
(e) a general ledger identifying security deposits;
(f) a monthly reconciliation of each separate account except where there has been no deposit or disbursement during that month. The reconciliation must include a written worksheet comparing the reconciled bank balance with the journal balance and with the ledger total to ensure agreement."
Time effective
SECTION 4. This act takes effect upon approval by the Governor.
Ratified the 16th day of May, 2000.
Approved the 19th day of May, 2000.
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